If I were to be using a piece of software that connects to the developers server and I was connected through a VPN would all the data on the server side be encrypted? Like if I am using a Keyword research tool and the tools needs to connect to the developers server, would all the keywords and data be easily seen by anyone with access to the server?And would a VPN address this issue?

After reading your PM I understood what you want, you want to encrypt your connection so the communication the application does to the dev's site is encrypted and they cant see it right ?

If that is what you want then give up VPN will not do that for you, you will have to either crack the application or null the ip/domain to the dev's site.

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anything that goes VPN > world wide will not be encrypted unless its HTTPS, secure protocols.

Let me give u a easy to follow example.

Lets say you want to have a fully encrypted connection with your friend and you have a VPN installed on your VPS.

if both of you connect to the VPN and let it handle the traffic then your communication with your friend, files, etc will be fully encrypted, however if from there you go to google's site for instance it will not be encrypt from your VPS to google, but what will be sent back to u from your VPS to YOU will be encrypted.

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